CIGNA Latest to Fund Database

Since UnitedHealth Group Inc. struck an agreement with New York Attorney General Cuomo to pay $350 million to resolve class-action lawsuits over reimbursing patients for out-of-network medical services, two Tier 1 health insurers named in the lawsuits have offered to settle out of court. First, Cuomo also reached an agreement with Aetna to pay $20 million to help establish an independent database used for calculating rates. This pact adds to the $50 million UnitedHealth previously agreed to pay to fund the database.

Yesterday, Philadelphia-based CIGNA announced that it will contribute $10 million toward building the database under an agreement with Cuomo.

The CIGNA announcement comes after a lengthy investigation by New York State on the integrity of a database made available by Ingenix Inc., a UnitedHealth Group subsidiary, which was used by several insurers in their billing departments. Cuomo charged that the database intentionally skewed downward by 10 to 28 percent the "usual and customary" rates on which reimbursement was determined.

All three insurers have stopped using the Ingenix database. Meanwhile, Cuomo stated that two other New York insurers, Excellus BlueCross Blue Shield and Capital District Physician's Health Plan, will soon be named in a suit. This follows news that subpoenas were issued to Empire BlueCross BlueShield unit of WellPoint Inc.

As reported by INN, the American Medical Association (AMA) and several state medical associations, including the Medical Society of New Jersey, joined with individual physicians in filing separate class-action lawsuits against the carriers, according to an AMA release.